Economic ignorance in WSJ reporting

“Miami Is Booming But Population Falls” is the (ungrammatical) headline in a front-page story of the August 1st Wall St. Journal.

It opens thus:

Miami, a global hot spot with ambitions to be a business and financial hub, is driving away more residents than it is attracting.

Why? The reporters proceed to tell you:

Surging housing costs . . . Home prices in Miami have soared 53% since June 2020 . . .

And we know what causes that, right? Landlord greed.

The reporters don’t say that directly, but here’s how they elaborate:

“The median asking rent has increased by 27% since 2019 . . . despite the shrinking population because of a chronic shortage of affordable rental housing.”

Oh-oh, looks like there’s too little greed here! Builders are too uninterested in money to meet the “chronic shortage of affordable rental housing.” And no builders from outside Miami, and outside Florida, are greedy enough to enter the market and fill the pent-up demand.

It’s totally incoherent: homeowners are getting big gains from selling their homes, but landlords are pricing rentals too high, so there’s a “shortage.”

The article’s claim is that Miami population is shrinking because people can’t afford to live there. But why can’t they afford it? Because other people are outbidding them! What’s “driving” people out? The opportunity to sell their homes at a great price (and move outside Miami, to a lower-cost region). It’s not a case of being “driven out”–it’s the reverse: a case of wanting to move out in order to enjoy a big profit.

The high cost of housing (rental and purchase) is due to the fact that a lot of people want to live there. You don’t find high housing costs in places where few people want to live, like Yucca Flats, Nevada.

So the reporters’ actual complaint is that the wealthy are outbidding the non-wealthy.

Yes, and I think that happens for luxury automobiles, too. Maybe also for dinners at fancy restaurants.

What’s called “gentrification,” can indeed result in falling population: the rich generally have several homes, but they count in the population of only one home, their domicile. So a native Miamian might sell a property that is his sole residence to a rich person who is in Miami only one month a year. The seller moves to a cheaper area, outside Miami, and the rich buyer doesn’t replace him in the population count.

As a long-time Manhattan resident, I can tell you that, in the evening, it is striking how many fewer lights you will see in the higher-floors of the tall residential buildings; the more expensive the real-estate, the less often it is occupied! It is the poor, not the rich, who live in crowded conditions.

The Wall Street Journal has a pretty decent editorial staff, but the reporters, like most all journalists, are leftist. This was less true when Rupert Murdoch was in charge. But now we see the resurgence of anti-capitalist economics.

Plus, there may be a sinister side. There’s a leftist campaign to bring rent-control to Miami. There’s a problem: the state of Florida expressly prohibits rent-control. But, alas, the prohibition includes an “unless there’s an emergency” clause. So the left is trying to paint this entirely benevolent outcome as a “housing emergency” (as if one’s inability to afford eating out very often at the toniest restaurants were an “eating crisis.”)

Here’s what Google turned up:

People also ask:

Are rent controls legal in Miami-Dade County?

Although Florida law is stacked against them, Miami-Dade County commissioners are considering studying the issue. Florida law largely prohibits rent controls unless there’s a “housing emergency.” Some on the Miami-Dade Board of County Commissioners are beginning to explore that option.

Rent control is something I would wish on my worst enemy. It’s like bombing your own city.

Update, I took a look at the follow-on on page 4, and it’s nothing but an appeal to Christianity–i.e., Marxism (which is based on “The Sermon on the Mount”):

sending many . . . working and middle-class residents searching for a more affordable place to live . . . the highest share of ‘cost-burdened renters’ [!] of any major metropolitan area . . . High rents sting . . .

For propaganda pieces, I always look to the last paragraph because savvy propagandists put there the thought, or feeling, they want you to take away. This article’s last paragraph quotes “Billy Corben, a local resident and gadfly documentarian who often criticizes local politicians’ push for rapid growth [my emphasis]. Here’s what ol’ Billy says:

The people who built this city [the proletariat] cannot afford to live in their own homes that they spent their entire lives in. . . . Once those people are gone, then what is Miami? What is left of this place?

What is left? Oh, maybe a home for people more productive than “the people who built this city.” Maybe people of more refined tastes and more cosmopolitan background. Maybe a better class of people than Joe sixpack.

But regardless of that, there’s no vested right to stop people from selling their homes for more than they had hoped [i.e., rising housing prices] or renting to people who outbid you.